Oil hits six-week high on hopes of extended OPEC cuts

Oil futures hit a six-week high on Tuesday, rising for a fifth day on optimism that OPEC and other countries may agree to extend production cuts in a bid to support prices.

Brent LCOc1 was up 26 cents, or 0.4 per cent, at 62.85 dollars a barrel by 0349 GMT, while U.S. crude CLc1 was 27 cents, or 0.5 per cent, higher at 58.12 dollars a barrel.

Brent touched its highest since August 1, while U.S. crude rose to the highest since July 31.

U.S. oil gained more than 2 per cent on Monday, while Brent finished the day 1.7 per cent higher as the market reacted to the appointment by Saudi Arabia’s king of his son, Abdulaziz bin Salman, as energy minister on Sunday.

Abdulaziz, a long-time member of the Saudi delegation to the Organisation of the Petroleum Exporting Countries (OPEC), said the pillars of Saudi Arabia’s policy would not change and a global deal to cut oil production by 1.2 million barrels per day would be maintained.

He added that the so-called OPEC+ alliance, made up of OPEC and non-OPEC countries including Russia, would be in place for the long term.

A meeting of OPEC and OPEC+ countries in Abu Dhabi this week “is stirring up hopes for additional supply cuts,” said Stephen Innes, Asia Pacific market strategist at AxiTrader.

Still, Russia’s oil output in August exceeded its quota under the OPEC+ agreements.

“Markets will need to see concrete progress on the production front, even as the world’s economy slows, to sustain gains,” said Jeffrey Halley, senior market analyst at OANDA.

Should oil end Tuesday higher it will be the longest run of gains since late July but headwinds remain as the U.S.-China trade war rumbles on.

Expectations

Executives at the annual Asia Pacific Petroleum Conference said on Monday they expect oil prices this year to be pressured by uncertainties surrounding the global economy, the U.S.-China trade war and increasing U.S. supplies.

In the United States, crude stockpiles are likely to have fallen for a fourth consecutive week last week, a preliminary Reuters’ poll showed on Monday.

Five analysts polled by Reuters estimated, on average, that crude inventories fell 2.6 million barrels in the week to September 6.

The Minister of State for Petroleum Resources, Chief Timipre Sylva has charged stakeholders of the Nigeria Liquefied Natural Gas (NLNG) Train-7 project to fast track actions on the project.

The Executive Secretary of the Content Development and Monitoring Board (NCDMB), Engr. Simbi Wabote revealed this in Abuja at the signing of the Letter of Intent (LoI) for the NLNG Train-7 Engineering, Procurement and Construction (EPC) Contract in Abuja.

In his goodwill message delivered at the ceremony, the Executive Secretary said: “The Honourable Minister of State for Petroleum Resources, Chief Timipre Sylva has this project as one of his focus areas to put an end to the drought of FID’s in the oil and gas industry in the last few years.

“Apart from the job opportunities and the accruable revenues from this multi-billion dollars Train-7 project, the Minister also sees the additional tonnage of LPG to be produced from Train-7 as a key benefit to reduce importation of LPG into the country.

“He is also excited that Train-7 project attracts other upstream gas supply projects required to keep the LNG train busy. The project opens up other development opportunities for some gas fields in the shallow and deep offshore acreages such as HI, HA, HK, and Opoukunou-Tuomo fields.”

Also speaking, the Executive Secretary of the NCDMB mentioned other economic advantages of the NLNG Train-7, just as said it would bring the fabrication yards of the NCDMB.

He said: “The NLNG Train-7 will deliver 100% engineering of all non-cryogenic areas in-country. The total in-country engineering man hours is set at 55% which exceeds the minimum level stipulated in the NOGICD Act in line with our resolve to push beyond the boundary of limitations.”

Oil hits six-week high on hopes of extended OPEC cuts

Oil futures hit a six-week high on Tuesday, rising for a fifth day on optimism that OPEC and other countries may agree to extend production cuts in a bid to support prices.

Brent LCOc1 was up 26 cents, or 0.4 per cent, at 62.85 dollars a barrel by 0349 GMT, while U.S. crude CLc1 was 27 cents, or 0.5 per cent, higher at 58.12 dollars a barrel.

Brent touched its highest since August 1, while U.S. crude rose to the highest since July 31.

U.S. oil gained more than 2 per cent on Monday, while Brent finished the day 1.7 per cent higher as the market reacted to the appointment by Saudi Arabia’s king of his son, Abdulaziz bin Salman, as energy minister on Sunday.

Abdulaziz, a long-time member of the Saudi delegation to the Organisation of the Petroleum Exporting Countries (OPEC), said the pillars of Saudi Arabia’s policy would not change and a global deal to cut oil production by 1.2 million barrels per day would be maintained.

He added that the so-called OPEC+ alliance, made up of OPEC and non-OPEC countries including Russia, would be in place for the long term.

A meeting of OPEC and OPEC+ countries in Abu Dhabi this week “is stirring up hopes for additional supply cuts,” said Stephen Innes, Asia Pacific market strategist at AxiTrader.

Still, Russia’s oil output in August exceeded its quota under the OPEC+ agreements.

“Markets will need to see concrete progress on the production front, even as the world’s economy slows, to sustain gains,” said Jeffrey Halley, senior market analyst at OANDA.

Should oil end Tuesday higher it will be the longest run of gains since late July but headwinds remain as the U.S.-China trade war rumbles on.

Expectations

Executives at the annual Asia Pacific Petroleum Conference said on Monday they expect oil prices this year to be pressured by uncertainties surrounding the global economy, the U.S.-China trade war and increasing U.S. supplies.

In the United States, crude stockpiles are likely to have fallen for a fourth consecutive week last week, a preliminary Reuters’ poll showed on Monday.

Five analysts polled by Reuters estimated, on average, that crude inventories fell 2.6 million barrels in the week to September 6.

Oil falls as US-Iran optimism faces US-China trade deal hopes

Oil prices edged lower on Monday on the outlook for increased supply of Iranian crude after France’s president lifted hopes for a deal between Washington and Tehran, but losses were limited by growing hopes that the United States and China could make a deal to end their trade war.
Brent crude lost 33 cents to $59.01 a barrel by 1:07 p.m. EDT (1707 GMT), after hitting a session high of $60.17.
U.S. West Texas Intermediate (WTI) crude futures fell 23 cents to $53.94 a barrel, after reaching $55.26 a barrel.
Prices fell after French President Emmanuel Macron said preparations were underway for a meeting between Iranian President Hassan Rouhani and U.S. President Donald Trump in the coming weeks to find a solution to a nuclear standoff.
Trump last year abandoned Iran’s 2015 nuclear deal with world powers, arguing that he wanted a bigger deal that not only limited Iran’s atomic work, but also reined in its support for proxies in Syria, Iraq, Yemen and Lebanon, and curbed its ballistic missile program.
Trump also tightened sanctions on Iran in May to try to choke off its oil exports.
“Now the market is pondering the possibility that we’ll see a flood or Iranian oil come onto the market if there’s progress made,” said Phil Flynn, an analyst at Price Futures Group in Chicago. “We have to be admittedly cautious because we’ve heard of deals one minute only to be tweeted down the next minute.”
Buoying prices, Trump said after a G7 summit of world leaders in Biarritz, France, that he believed China was sincere about wanting to reach a deal.
Chinese Vice Premier Liu He, who has been leading the talks with Washington, said China was willing to resolve the dispute through “calm” negotiations and opposed any increase in trade tensions.
Oil prices have fallen about 20% from a 2019 high reached in April in part because of worries that the U.S.-China trade conflict is hurting the global economy, which could dent demand for oil, reports Reuters.
China’s Commerce Ministry said last week it would impose additional tariffs of 5% or 10% on a total of 5,078 products originating from the United States, including crude oil, agricultural products and small aircraft.
In retaliation, Trump said he was ordering U.S. companies to look at ways to close operations in China and make products in the United States.
SEB analyst Bjarne Schieldrop said the oil market was worried about “the secondary global growth effects of an upwards spiraling trade war between China and the U.S..”
“The second concern for the oil market is that … China is now ready to wrestle with the U.S. in the global space of oil.

International benchmark Brent crude futures LCOc1 were down 18 cents or 0.3%, from the previous settlement, to $58.39 a barrel by 0310 GMT.

U.S. West Texas Intermediate (WTI) CLc1 futures were at $54.81 per barrel, down by 12 cents, or 0.2%, from the last close.

“Although the outlook remains bleak, oil prices have remained anchored this week after a rapid response from Saudi Arabia, who is serious about stepping in to defend the oil price,” Stephen Innes, managing partner at VM Markets Pte Ltd said in a note.

Saudi Arabia, the de-facto leader of the Organisation of the Petroleum Exporting Countries (OPEC), said late last week it plans to keep its crude oil exports below 7 million barrels per day in August and September to help drain global oil inventories.

Analysts expect the country to support prices ahead of its plans to float Saudi Aramco, in what could be the world’s largest initial public offering (IPO).

Saudi Aramco was ready for its IPO, but the timing for the deal will be decided by its sole shareholder, the Saudi government, a senior executive said on Monday.

Kuwait on Monday also reiterated its commitment to OPEC+ supply curbs after Oil Minister Khaled al-Fadhel said Kuwait had cut its own output by more than required by the accord.

OPEC and its allies, known as OPEC+, have agreed to cut 1.2 million barrels per day (bpd) since Jan. 1.

But booming U.S. shale oil production continues to chip away at efforts to limit the global supply overhang, weighing on prices.

U.S. oil output from seven major shale formations is expected to rise by 85,000 barrels per day (bpd) in September, to a record 8.77 million bpd, the U.S. Energy Information Administration forecast in a report.

Gloomy forecasts for the global economy and oil demand growth have also dragged on oil prices as the trade dispute between the United States and China escalates.

“The swift reaction from Saudi Arabia will likely stabilize oil prices, but the oil price probably won’t move much above $60 per barrel until there is evidence of progress in U.S.-China trade negotiations,” said Innes.

China’s central bank lowered its official yuan midpoint for the ninth straight day to a fresh 11-year low on Tuesday to reflect broad weakness in the local unit.

International benchmark Brent crude futures LCOc1 were down 18 cents or 0.3%, from the previous settlement, to $58.39 a barrel by 0310 GMT.

U.S. West Texas Intermediate (WTI) CLc1 futures were at $54.81 per barrel, down by 12 cents, or 0.2%, from the last close.

“Although the outlook remains bleak, oil prices have remained anchored this week after a rapid response from Saudi Arabia, who is serious about stepping in to defend the oil price,” Stephen Innes, managing partner at VM Markets Pte Ltd said in a note.

Saudi Arabia, the de-facto leader of the Organisation of the Petroleum Exporting Countries (OPEC), said late last week it plans to keep its crude oil exports below 7 million barrels per day in August and September to help drain global oil inventories.

Analysts expect the country to support prices ahead of its plans to float Saudi Aramco, in what could be the world’s largest initial public offering (IPO).

Saudi Aramco was ready for its IPO, but the timing for the deal will be decided by its sole shareholder, the Saudi government, a senior executive said on Monday.

Kuwait on Monday also reiterated its commitment to OPEC+ supply curbs after Oil Minister Khaled al-Fadhel said Kuwait had cut its own output by more than required by the accord.

OPEC and its allies, known as OPEC+, have agreed to cut 1.2 million barrels per day (bpd) since Jan. 1.

But booming U.S. shale oil production continues to chip away at efforts to limit the global supply overhang, weighing on prices.

U.S. oil output from seven major shale formations is expected to rise by 85,000 barrels per day (bpd) in September, to a record 8.77 million bpd, the U.S. Energy Information Administration forecast in a report.

Gloomy forecasts for the global economy and oil demand growth have also dragged on oil prices as the trade dispute between the United States and China escalates.

“The swift reaction from Saudi Arabia will likely stabilize oil prices, but the oil price probably won’t move much above $60 per barrel until there is evidence of progress in U.S.-China trade negotiations,” said Innes.

China’s central bank lowered its official yuan midpoint for the ninth straight day to a fresh 11-year low on Tuesday to reflect broad weakness in the local unit.

International benchmark Brent crude futures LCOc1 were down 18 cents or 0.3%, from the previous settlement, to $58.39 a barrel by 0310 GMT.

U.S. West Texas Intermediate (WTI) CLc1 futures were at $54.81 per barrel, down by 12 cents, or 0.2%, from the last close.

“Although the outlook remains bleak, oil prices have remained anchored this week after a rapid response from Saudi Arabia, who is serious about stepping in to defend the oil price,” Stephen Innes, managing partner at VM Markets Pte Ltd said in a note.

Saudi Arabia, the de-facto leader of the Organisation of the Petroleum Exporting Countries (OPEC), said late last week it plans to keep its crude oil exports below 7 million barrels per day in August and September to help drain global oil inventories.

Analysts expect the country to support prices ahead of its plans to float Saudi Aramco, in what could be the world’s largest initial public offering (IPO).

Saudi Aramco was ready for its IPO, but the timing for the deal will be decided by its sole shareholder, the Saudi government, a senior executive said on Monday.

Kuwait on Monday also reiterated its commitment to OPEC+ supply curbs after Oil Minister Khaled al-Fadhel said Kuwait had cut its own output by more than required by the accord.

OPEC and its allies, known as OPEC+, have agreed to cut 1.2 million barrels per day (bpd) since Jan. 1.

But booming U.S. shale oil production continues to chip away at efforts to limit the global supply overhang, weighing on prices.

U.S. oil output from seven major shale formations is expected to rise by 85,000 barrels per day (bpd) in September, to a record 8.77 million bpd, the U.S. Energy Information Administration forecast in a report.

Gloomy forecasts for the global economy and oil demand growth have also dragged on oil prices as the trade dispute between the United States and China escalates.

“The swift reaction from Saudi Arabia will likely stabilize oil prices, but the oil price probably won’t move much above $60 per barrel until there is evidence of progress in U.S.-China trade negotiations,” said Innes.

China’s central bank lowered its official yuan midpoint for the ninth straight day to a fresh 11-year low on Tuesday to reflect broad weakness in the local unit.

International benchmark Brent crude futures LCOc1 were down 18 cents or 0.3%, from the previous settlement, to $58.39 a barrel by 0310 GMT.

U.S. West Texas Intermediate (WTI) CLc1 futures were at $54.81 per barrel, down by 12 cents, or 0.2%, from the last close.

“Although the outlook remains bleak, oil prices have remained anchored this week after a rapid response from Saudi Arabia, who is serious about stepping in to defend the oil price,” Stephen Innes, managing partner at VM Markets Pte Ltd said in a note.

Saudi Arabia, the de-facto leader of the Organisation of the Petroleum Exporting Countries (OPEC), said late last week it plans to keep its crude oil exports below 7 million barrels per day in August and September to help drain global oil inventories.

Analysts expect the country to support prices ahead of its plans to float Saudi Aramco, in what could be the world’s largest initial public offering (IPO).

Saudi Aramco was ready for its IPO, but the timing for the deal will be decided by its sole shareholder, the Saudi government, a senior executive said on Monday.

Kuwait on Monday also reiterated its commitment to OPEC+ supply curbs after Oil Minister Khaled al-Fadhel said Kuwait had cut its own output by more than required by the accord.

OPEC and its allies, known as OPEC+, have agreed to cut 1.2 million barrels per day (bpd) since Jan. 1.

But booming U.S. shale oil production continues to chip away at efforts to limit the global supply overhang, weighing on prices.

U.S. oil output from seven major shale formations is expected to rise by 85,000 barrels per day (bpd) in September, to a record 8.77 million bpd, the U.S. Energy Information Administration forecast in a report.

Gloomy forecasts for the global economy and oil demand growth have also dragged on oil prices as the trade dispute between the United States and China escalates.

“The swift reaction from Saudi Arabia will likely stabilize oil prices, but the oil price probably won’t move much above $60 per barrel until there is evidence of progress in U.S.-China trade negotiations,” said Innes.

China’s central bank lowered its official yuan midpoint for the ninth straight day to a fresh 11-year low on Tuesday to reflect broad weakness in the local unit.

International benchmark Brent crude futures LCOc1 were down 18 cents or 0.3%, from the previous settlement, to $58.39 a barrel by 0310 GMT.

U.S. West Texas Intermediate (WTI) CLc1 futures were at $54.81 per barrel, down by 12 cents, or 0.2%, from the last close.

“Although the outlook remains bleak, oil prices have remained anchored this week after a rapid response from Saudi Arabia, who is serious about stepping in to defend the oil price,” Stephen Innes, managing partner at VM Markets Pte Ltd said in a note.

Saudi Arabia, the de-facto leader of the Organisation of the Petroleum Exporting Countries (OPEC), said late last week it plans to keep its crude oil exports below 7 million barrels per day in August and September to help drain global oil inventories.

Analysts expect the country to support prices ahead of its plans to float Saudi Aramco, in what could be the world’s largest initial public offering (IPO).

Saudi Aramco was ready for its IPO, but the timing for the deal will be decided by its sole shareholder, the Saudi government, a senior executive said on Monday.

Kuwait on Monday also reiterated its commitment to OPEC+ supply curbs after Oil Minister Khaled al-Fadhel said Kuwait had cut its own output by more than required by the accord.

OPEC and its allies, known as OPEC+, have agreed to cut 1.2 million barrels per day (bpd) since Jan. 1.

But booming U.S. shale oil production continues to chip away at efforts to limit the global supply overhang, weighing on prices.

U.S. oil output from seven major shale formations is expected to rise by 85,000 barrels per day (bpd) in September, to a record 8.77 million bpd, the U.S. Energy Information Administration forecast in a report.

Gloomy forecasts for the global economy and oil demand growth have also dragged on oil prices as the trade dispute between the United States and China escalates.

“The swift reaction from Saudi Arabia will likely stabilize oil prices, but the oil price probably won’t move much above $60 per barrel until there is evidence of progress in U.S.-China trade negotiations,” said Innes.

China’s central bank lowered its official yuan midpoint for the ninth straight day to a fresh 11-year low on Tuesday to reflect broad weakness in the local unit.

International benchmark Brent crude futures LCOc1 were down 18 cents or 0.3%, from the previous settlement, to $58.39 a barrel by 0310 GMT.

U.S. West Texas Intermediate (WTI) CLc1 futures were at $54.81 per barrel, down by 12 cents, or 0.2%, from the last close.

“Although the outlook remains bleak, oil prices have remained anchored this week after a rapid response from Saudi Arabia, who is serious about stepping in to defend the oil price,” Stephen Innes, managing partner at VM Markets Pte Ltd said in a note.

Saudi Arabia, the de-facto leader of the Organisation of the Petroleum Exporting Countries (OPEC), said late last week it plans to keep its crude oil exports below 7 million barrels per day in August and September to help drain global oil inventories.

Analysts expect the country to support prices ahead of its plans to float Saudi Aramco, in what could be the world’s largest initial public offering (IPO).

Saudi Aramco was ready for its IPO, but the timing for the deal will be decided by its sole shareholder, the Saudi government, a senior executive said on Monday.

Kuwait on Monday also reiterated its commitment to OPEC+ supply curbs after Oil Minister Khaled al-Fadhel said Kuwait had cut its own output by more than required by the accord.

OPEC and its allies, known as OPEC+, have agreed to cut 1.2 million barrels per day (bpd) since Jan. 1.

But booming U.S. shale oil production continues to chip away at efforts to limit the global supply overhang, weighing on prices.

U.S. oil output from seven major shale formations is expected to rise by 85,000 barrels per day (bpd) in September, to a record 8.77 million bpd, the U.S. Energy Information Administration forecast in a report.

Gloomy forecasts for the global economy and oil demand growth have also dragged on oil prices as the trade dispute between the United States and China escalates.

“The swift reaction from Saudi Arabia will likely stabilize oil prices, but the oil price probably won’t move much above $60 per barrel until there is evidence of progress in U.S.-China trade negotiations,” said Innes.

China’s central bank lowered its official yuan midpoint for the ninth straight day to a fresh 11-year low on Tuesday to reflect broad weakness in the local unit.

Oil jumps on expectations producers may cut supply after 4% slump

Oil futures jumped more than $1 a barrel on Thursday, recovering half of the nearly 5% losses in the previous session, on expectations that lower prices may lead to production cuts.

Brent crude had rebounded to $57.75 a barrel, up $1.52, or 2.7%, from its last close by 0401 GMT, while U.S. West Texas Intermediate (WTI) crude futures jumped $1.51, or 2.96%, to $52.60 a barrel.

Both contracts hit their lowest levels since January on Wednesday after a surprise build in U.S. crude inventories added to worries that the China-U.S. trade war could further dampen demand growth this year.

Analysts said that crude prices were moving higher on the expectation that Saudi Arabia, the world’s biggest oil exporter, and other producers in the Organization of the Petroleum Exporting Countries (OPEC) may take action to support the market by reducing supply.

“The threshold is $60 a barrel and if you go below that for a significant period of time, I would expect supplies to be taken off the market in order to support prices up,” said Virendra Chauhan, an oil analyst at Energy Aspects in Singapore.

Bloomberg in a report on Wednesday cited a Saudi official saying that the country is in talks with other producers to take action to halt the oil price slide.

“Trade war rhetoric will continue to guide markets, but the comments from Saudi Arabia could lead to unprecedented action to stabilize prices,” said Alfonso Esparza, a Toronto-based senior market analyst at Oanda.

“It is hard to imagine what that would look like given how hard it was to get the OPEC+ to agree to the production limit agreement, but given the potential free fall from crude if the trade war continues, no option is off the table,” he said, referring to OPEC+, a group including OPEC and non-OPEC producers such as Russia.

Esparza added that a weaker U.S. dollar has also lent support to the oil price rebound.

The dollar index, which measures the greenback against six other major currencies, has declined 1% since July 31, the day before the United States escalated its trade dispute with China by vowing to impose more tariffs, setting in motion retaliatory steps by China, reports Reuters.